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Why the free BA Amex credit card is now the best cashback card in Britain (updated)

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Three weeks ago, I ran an article explaining why the free British Airways American Express card was now the best cashback card in Britain …..

…… assuming, of course, that you believe Nectar points are as good as cash. Whether you do believe this will depend on how much money you spend in Sainsbury’s, in Argos or on eBay.co.uk, the main outlets for Nectar points.

As we covered last Tuesday, American Express has just cut the cashback rate on its two American Express Platinum Cashback credit cards.

I wanted to take another look at how this impacts the value of the free BA Amex card – when treated as a pure cashback card – versus the two American Express Platinum Cashback competitors.

A reminder about how Avios and Nectar convert

Back in January, Avios and Nectar unveiled their new partnership.

In a huge surprise, the two companies introduced two-way points transfers. This page of ba.com explains how Nectar transfers work.

Not only that, but the transfers were at a very generous rate for both parties:

  • 250 Avios gets you 400 Nectar points, which are worth £2 off your shopping at Sainsbury’s, Argos or eBay
  • 400 Nectar points get you 250 Avios, which HfP tends to value at around £2-£2.50
Nectar Avios light

Following the launch of the partnership ….

  • the value of a Nectar point increased from 0.5p unless you have a very low valuation of an Avios point (and if you do have a low valuation of an Avios, you’re unlikely to be reading this)
  • Avios suddenly had a ‘floor’ value of 0.8p, since this was what you got by moving them to Nectar and redeeming for shopping credit. You would be a mug to redeem Avios for any other redemption which got you less than 0.8p per point.

This led to a big disruption to the established order. For example:

  • you’d be mad to redeem Avios for hotel bookings, car hire, seat selection fees or even, in almost all cases, ‘Part Pay With Avios’, since all of these get you less than 0.8p per point
  • most American Express Membership Rewards redemptions became irrelevant, because almost all of them get you less than 0.8p per point. You should transfer to Avios and into Nectar instead, guaranteeing the 0.8p valuation.

The free British Airways American Express has now become the UK’s best cashback credit card

Yes, weird but true.

If you know someone looking for a free cashback credit card, tell them to get a British Airways American Express card. The representative APR is 22.2% variable.

This is how the free BA Amex compares to the best cashback cards.

The UK’s best ‘pure’ free cashback credit card is American Express Platinum Cashback Everyday. The representative APR is 22.2% variable.

Following the cuts unveiled last week, it pays you per calendar year:

  • 0.5% cashback on spend up to £10,000 (but 0% if your annual spend is under £3,000)
  • 1% cashback on spend above £10,000

The cashback comes as a lump sum at the year-end, added to your card balance.

Let’s compare this to the free British Airways American Express card. The free BA Amex pays:

  • 1 Avios per £1 spent, with 1 Avios converting into 1.6 Nectar points
HFP Amex American Express Platinum Cashback card

Compare the free BA Amex to the free Amex Platinum Cashback Everyday

This is what you would receive each year in cashback with different levels of spending. Remember that Cashback Everyday requires £3,000 of annual spending before it pays out.

  • £1,000 – £0 Cashback Everyday vs £8 BA Amex
  • £2,000 – £0 Cashback Everyday vs £16 BA Amex
  • £3,000 – £15 Cashback Everyday vs £24 BA Amex
  • £4,000 – £20 Cashback Everyday vs £32 BA Amex
  • £5,000 – £25 Cashback Everyday vs £40 BA Amex
  • £6,000 – £30 Cashback Everyday vs £48 BA Amex
  • £7,000 – £35 Cashback Everyday vs £56 BA Amex
  • £8,000 – £40 Cashback Everyday vs £64 BA Amex
  • £9,000 – £45 Cashback Everyday vs £72 BA Amex
  • £10,000 – £50 Cashback Everyday vs £80 BA Amex
  • £11,000 – £60 Cashback Everyday vs £88 BA Amex
  • £12,000 – £70 Cashback Everyday vs £96 BA Amex
  • £13,000 – £80 Cashback Everyday vs £104 BA Amex
  • £14,000 – £90 Cashback Everyday vs £112 BA Amex
  • £15,000 – £100 Cashback Everyday vs £120 BA Amex

Irrespective of what you spend, the free American Express Platinum Cashback Everyday card gets you a lower return than the Nectar points you’d earn from the free British Airways American Express card.

This assumes, of course, that you treat Nectar points as equivalent to cash. If you shop in Sainsbury’s then they definitely are as good as cash.

If you would need to go out of your way to use them, either at Sainsbury’s, Argos, eBay.co.uk or another partner, then you need to factor that in.

I would never deny that cash beats the equivalent value in vouchers, although you will get the occasional Nectar promotion where you can get more than 0.5p per point.

Compare the free BA Amex to the £25 Amex Platinum Cashback card

American Express has a second cashback card, Platinum Cashback. Representative APR 27.3% variable including the £25 fee, 22.2% variable APR on purchases.

This carries a £25 annual fee but has a higher return:

  • 0.75% cashback on spend up to £10,000
  • 1.25% cashback on spend above £10,000

Amusingly, the free British Airways card is still more rewarding than the £25 Platinum Cashback card unless you are spending £17,000 per year.

Here is the return, adjusting for the £25 annual fee on Platium Cashback. This is based on the reduced rewards announced last week:

  • £1,000 – £(17.50) Platinum Cashback vs £8 BA Amex
  • £2,000 – £(10) Platinum Cashback vs £16 BA Amex
  • £3,000 – £2.50 Platinum Cashback vs £24 BA Amex
  • £4,000 – £5 Platinum Cashback vs £32 BA Amex
  • £5,000 – £12.50 Platinum Cashback vs £40 BA Amex
  • £6,000 – £20 Platinum Cashback vs £48 BA Amex
  • £7,000 – £27.50 Platinum Cashback vs £56 BA Amex
  • £8,000 – £35 Platinum Cashback vs £64 BA Amex
  • £9,000 – £42.50 Platinum Cashback vs £72 BA Amex
  • £10,000 – £50 Platinum Cashback vs £80 BA Amex
  • £11,000 – £62.50 Platinum Cashback vs £88 BA Amex
  • £12,000 – £75 Platinum Cashback vs £96 BA Amex
  • £13,000 – £87.50 Platinum Cashback vs £104 BA Amex
  • £14,000 – £100 Platinum Cashback vs £112 BA Amex
  • £15,000 – £112.50 Platinum Cashback vs £120 BA Amex

You need to spend £17,000 – adjusting for the £25 fee – before the American Express Platinum Cashback card beats the free British Airways American Express.

HFP Amex American Express Nectar Card

How about the American Express Nectar credit card?

I know what you’re thinking:

“Surely the official Nectar American Express card earns you more from Nectar points than the free British Airways American Express card?”

Here’s the thing ….. it doesn’t. The Nectar American Express card has a £25 annual fee after the first year, which cuts into your return. Representative APR 27.3% variable including the £25 fee, 22.2% variable APR on purchases.

The Nectar American Express card earns you:

  • 2 Nectar points, worth 1p, for every £1 spent

This is how your returns stack up, adjusting for the £25 fee on Nectar American Express:

  • £1,000 – £(15) Nectar Amex vs £8 BA Amex
  • £2,000 – £(5) Nectar Amex vs £16 BA Amex
  • £3,000 – £5 Nectar Amex vs £24 BA Amex
  • £4,000 – £15 Nectar Amex vs £32 BA Amex
  • £5,000 – £25 Nectar Amex vs £40 BA Amex
  • £6,000 – £35 Nectar Amex vs £48 BA Amex
  • £7,000 – £45 Nectar Amex vs £56 BA Amex
  • £8,000 – £55 Nectar Amex vs £64 BA Amex
  • £9,000 – £65 Nectar Amex vs £72 BA Amex
  • £10,000 – £75 Nectar Amex vs £80 BA Amex
  • £11,000 – £85 Nectar Amex vs £88 BA Amex
  • £12,000 – £95 Nectar Amex vs £96 BA Amex
  • £13,000 – £105 Nectar Amex vs £104 BA Amex
  • £14,000 – £115 Nectar Amex vs £112 BA Amex
  • £15,000 – £125 Nectar Amex vs £120 BA Amex

You need to spend £13,000 before, adjusting for the £25 fee, the Nectar American Express gets you more ‘pseudo’ cashback than the free British Airways American Express.

Conclusion

It’s a weird old world, but – as the numbers above show – the free British Airways American Express credit card is now the best cashback credit card in Britain for most people, unless you are a big spender.

To beat the return on the free BA Amex, assuming you transferred your Avios into Nectar points, you’d need to spend:

….. before it became a better deal.

You will never beat the free British Airways American Express with the free Amex Platinum Cashback Everyday card.

The cut in the return on the two Platinum Cashback cards has had a big impact here, putting them further behind the free BA Amex.

Is anyone non-flyer really going to apply for the free BA Amex purely to use it as a cashback card? Probably not, but they should.

PS. Before anyone mentions it ….. I am aware that you can make the same case for the American Express Rewards Credit Card. This is free for life and earns 1 American Express Membership Rewards point per £1. These would convert 1:1 into Avios and then 1:1.6 into Nectar.

British Airways American Express card

British Airways American Express

5,000 Avios for signing up, no annual fee and a companion voucher for spending £20,000 Read our full review

Nectar American Express

First year free and 20,000 points sign-up bonus – worth £100 or 12,500 Avios Read our full review

American Express Platinum Cashback

The UK’s most generous cashback credit card with a fee Read our full review

American Express Platinum Cashback Everyday

The UK’s most generous fee-free cashback credit card Read our full review

Comments (58)

  • Doug says:

    Sainsbury’s gift card is not cash. Aldi has better prices and quality tbh

    • Andrew says:

      But far less choice and a ghastly shopping experience.

      • Erico1875 says:

        I disagree on the experience. You are in and out Aldi rapido with 95% of what you need on a weekly shop

        • Andrew says:

          We maybe have different ideas of what’s needed in a weekly shop then. But we can agree to disagree.

          • Rob says:

            I don’t see how a shop that sells 5% of the lines of a full size supermarket can have ‘everything you need’ ….

          • Andrew says:

            Does anyone really ‘need’ 50 different types of pasta? Or 20 different brands of bread? Sure you may have a particular favourite but I wouldn’t say you ‘need’ that particular one. For me a large shop in Lidl or Aldi topped up by a few speciality items from a larger supermarket gets me everything I need and want and at a fraction of the price of buying the whole thing in Waitrose.

          • Andrew says:

            Different Andrew – one Andrew likes Lidl, the other one doesn’t!

        • lumma says:

          Strange beer to the left of me
          Cheap biscuits to the right
          Here I am
          Stuck in the Lidl with you

        • Aston100 says:

          That is a very highly subjective opinion there Erico.

        • Erico1875 says:

          “I don’t see how a shop that sells 5% of the lines of a full size supermarket can have ‘everything you need’ ….”

          Meat, chicken,fish, bread, cheese, fruit, veg, cleaning products make up most of our shopping.
          They dont have 10 different brands of each product granted.
          If they started doing non alcoholic cider and Cava, I probably would hardly be in Sainsburys or Tesco

          • Genghis says:

            I find they sell the core items – meat, fish, certain tinned stuff etc – but all of the different things that we like to cook with, especially Asian food, they just don’t stock: sesame oil, rice wine vinegar, mirin, cooking sake, kimchi etc.

          • Rob says:

            Surely one of the benefits of being alive and living in a wealthy Western country in the 21st century is being able to choose from 10 different types of smoked salmon?!

    • Peter K says:

      I personally was very disappointed with Aldi when one opened near us. With all the hype I was expecting great things, but with veg that always goes off super fast and poor ranges overall I go there sometimes for small shops, but mostly I’ve gone back to my old haunts.

      • Rhys says:

        Lidl is better than Aldi, in my experience.

        • WaynedP says:

          +1 !

          And as Ghengis points out, not overly Asian-centric, but very good Euro-centric cooking ingredients and high quality.

          Only one line of a product, but it will generally be very high quality, certainly good enough for the likes of me. Practically all their selected wines are award winners at considerably less cost than other supermarkets.

        • MCO says:

          I honestly can’t tell the difference between both.

    • John says:

      Aldi is a 30 minute drive, Sainsbury’s is 5 minute walk.

    • Memesweeper says:

      eBay and Argos cover almost everything at decent prices. You don’t need to be local to a branch to cash out through these partners.

    • Andrew says:

      If you only ever shop at a single supermarket, then you are being very foolish indeed.

      I was in Morrison’s on Saturday, and bought 10 1 litres bottles of Cawston’s Beetroot juice. Reduced to clear, best before Feb 2022, £0.75 each. Sazbo’s and Tesco sell them at £2.50 a bottle. Kerching. With my usual 10% discount that’s an £18 saving and lots of lovely potassium without having to resort to eating nasty crescent shaped fruit.

      Likewise Iceland’s Food Warehouse. Coming out with crates of AG Barr’s cupboard staples.

      Then into Waitrose to buy dinner.

      • Aston100 says:

        Hi Andrew, in between all this driving between various supermarkets, do you get much time to enjoy the benefits of your cost savings?

        • illuminatus says:

          Being a foodie, and loving a bargain, I still really can’t understand all this driving around in this day and age. About 90% of our weekly shopping comes just after a few clicks at Ocado. We can then order something special either from Farmdrop, or local butcher that does free deliveries, or Whole Foods via Amazon…

          • Doug says:

            As a 30s couple we shop for food every week, usually we go to Aldi or Lidl 2-3x a month and we swap between Tesco/Sainsburys for that big top-up. Waitrose gets a chance when they send those post vouchers 😀
            Online shopping is nice, but it can be time consuming, during the lockdown supermarket was the highlight of the week!

    • Kevin C says:

      The lockdowns meant I discovered Natoora who sell great food but you have to be careful not to click on the wrong things and accidentally spend £200 on some mushrooms.

      • Rob says:

        I used to get German white asparagus from Natoora whilst the German Deli was shut, but the price was scary.

        • Kevin C says:

          They do ‘peak season’ boxes now if you haven’t used them for a while. They aren’t too crazy pricey. And you can pay to become a ‘Natoora Radical’ and get free delivery and a gift each month. It is more expensive than Lidl and there’s no getting around that.

    • Tim says:

      Aldi quality is miles below the large supermarkets (excluding Asda) from my experience throughout 2017. Bugs and nests almost always found in fruit and veg, and meat horrendously off 3/4 days before sell-by. Way cheaper but also way worse.

  • Andrew says:

    With the recent 24k referral bonus I did manage to convince a friend who had never had an Amex that the BA card was a good option as they are a regular Sainsbury’s shopper and the £80 signup bonus seemed appealing enough. Most people don’t want to get involved in an annual fee card like Gold, even if free in the first year and the low spend threshold for the BA signup bonus is also attractive.

  • Freddy says:

    Ahh but the free BA amex would block you from the 2 yearly churn on the BAPP card. This is my reasoning to not get the BA amex

    • Secret Squirrel says:

      Don’t you just upgrade the free BA Amex to BAPP. Yes, you don’t get the AVIOS bonus or maybe 6k sometimes but still the 2 year voucher at 10k.

      • Freddy says:

        You’d be ahead holding a CB card or nectar and periodically get the BAPP solely for the bonus

  • Aston100 says:

    Surely in the first (free) year, the Amex Nectar is better.

    • Jonathan says:

      If someone is new to Amex, then they’d have to choose between the BA card and Nectar for the best sign up bonus

      • Genghis says:

        Obviously the logical thing to do is to get the Nectar first and then the BAPP, but I understand that everyone is different and may not want to pay a few quid in fees for a shed load more points.

      • Chris Heyes says:

        Jonathan Not necessarily someone new to Amex could choose Gold Card first,
        hit targets, plus 15k spend then cancel at 13 months, get BA Premium hit targets then cancel after 241 transfers.

    • Rob says:

      It is, but this is a long term analysis.

      • Chris Heyes says:

        Rob, But surely any long term analysis Doesn’t really work “Long Term”
        Manly because circumstances change, I Don’t mean the replicant
        I mean the offers ect who would have thought 20,000 MR for Gold
        or 50,000 and 100,0000 unheard of
        That isn’t to say a long term analysis is incorrect because it could be correct ?
        but if you had done the analysis 12/18 months ago would it be the same ?
        In 6/12 months will it be accurate ?

        • Rob says:

          Fair point. You are getting down a wormhole then though. If there is a skill to writing this stuff it is knowing where to draw the line in terms of adding extra layers of detail. We stripped certain reference articles back a bit as part of the relaunch last year, because a large number of people simply want to be told ‘do this’ rather than read a more detailed analysis of multiple options and the triggers which would make one better than the other.

          • WaynedP says:

            @Rob Spot on.

            Now apply same reasoning to your 10 varieties of smoked salmon. Yes, we are phenomenally privileged, but many are happy to leave the decision of choosing a single, top quality selection to a trusted retailer. And so far I’ve never had reason to complain at Lidl’s choice of anything I’ve bought from balsamic vinegar to bratwurst to South African Pinotage.

            A generation ago, M&S enjoyed a similar brand reliability, but times, tastes and prices have evolved since then.

          • Peter K says:

            @WaynedP
            Your logic has some merit, but does not apply to everyone. The “discounters” do not care about those on special diets (my local Lidl stopped stocking gluten free bread and cereal for example) or those who don’t like the one choice available (the home baking options are poor for example).

            I also have also rarely thought what Aldi or Lidl provide is a good for a treat meal. A solid basic meal, but not a treat. Some exceptions to that, but not many.

          • Chris Heyes says:

            Rob But I go down wormholes all the time lol, sometimes with questions or answers and especially comments lol
            I’m sure you’ve noticed
            Yes there is a skill to writing the stuff you and Rhys write, but to a lesser degree there is a skill in digesting the useful to the useless for an individual use.
            We take onboard but adapt to how we play.
            Yes I’ve noticed most (not all) actually want to be told what to do, without the thinking for themselves.

  • Rob says:

    It would, but to make the point I have focused this on long term benefits.

    • Genghis says:

      Appealing to the masses? 🙂 I’d hazard a guess that the most loyal HfP readers are more likely to chop and change their card portfolio to maximise returns.

      • Gorazd says:

        You often mention companion vouches is only great for couples. But as a single I love tagging a friend along for cheap.

        • Rhys says:

          I do the same, but it clearly doesn’t work for everyone.

      • Aston100 says:

        Oh yeah I keep forgetting the bit about “most of our readership are London-based millionaires”.

        • Rob says:

          I genuinely struggle to see why the logic that a website aimed at BA Silver and Gold card holders – 90% of whom live or work in London if UK based – and which generally writes about stuff of interest to people who live in London, and can attract 500 people to pay cash to attend parties in London, would have a London-based readership, seems to confuse you 🙂

      • TGLoyalty says:

        Even if the commentators aren’t the usual readership there are plenty of HfP articles suggesting churning is the best way to accumulate points.

        I don’t see why you would completely ignore cards with the first year free.

      • Chris Heyes says:

        Rhys And then there’s Me lol

      • AndyC says:

        *monolith…

  • Andrew says:

    Only in Britain? What about Northern Ireland residents?

  • Jody Tranter says:

    How about compared to the Vitality cash back credit @ 2%? Does BA card still win?

    • Jody says:

      Has it? The rate is the same I thought, it’s just the spend requirements are higher (not a problem for me)

  • Rob says:

    As I say at the end of the article, you are correct – Amex Rewards is equally as good. As this is a BA focused site, however, I chose the BA card as our example.

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